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BofA/Merrill reinstating Oilfield Services coverage with Halliburton as top pick

BofA analyst Chase Mulvehill reinstated coverage of U.S. onshore and diversified oilfield service, or OFS, saying he has a bullish near-to-medium term view on the sector. The analyst notes that OFS should outperform thanks to rising oil prices that should lead to "solid" cash flows across the sector. Mulvehill further anticipates investment to increase across the industry, with North America land E&P spending surprising to the upside and U.S. onshore D&C spending rising nearly 20%. The analyst also sees "Permian pipeline relief" adding to the benefits with exposure to the basin. Mulvehill's Top Pick is Halliburton (HAL), and his other Buy-rated names include Baker Hughes (BHGE), C&J Energy Services (CJ), FTS International (FTSI), Keane Group (FRAC), Nabors Industries (NBR), Nine Energy Service (NINE), Patterson-UTI Energy (PTEN), ProPetro Holdings Corp (PUMP), and Schlumberger (SLB).

Catch up on today's top five analyst upgrades with this list compiled by The Fly: 1. Walmart (WMT) upgraded to Buy from Hold at Deutsche Bank with analyst Paul Trussell saying the retailer is reaping returns on the many years of investment in e-commerce and customer service. 2. Cree (CREE) upgraded to Neutral from Underweight at JPMorgan with analyst Paul Coster saying he sees a more balanced risk/reward following the recent underperformance of the shares. 3. Amphenol (APH) upgraded to Buy from Neutral at Goldman Sachs with analyst Mark Delaney saying the company's "best in class" execution and "diverse" end markets position it well in a tougher cyclical environment. 4. Dominion (D) upgraded to Overweight from Neutral at JPMorgan with analyst Christopher Turnure saying the company is entering a period of balance sheet improvement, de-risked business mix and overall simplification, with or without the Scana (SCG) assets. 5. Baker Hughes (BHGE) upgraded to Buy from Hold at Jefferies with analyst Brad Handler saying earnings power of $4 per share next decade "seems tangible," as is free cash flow conversion of greater than 90% of estimated earnings. This list is just a portion of The Fly's full analyst coverage. To see The Fly's full Street Research coverage, click here.

10/09/18

10/09/18NO CHANGE

Fly Intel: Today's top analyst calls on Wall Street

Check out today's top analyst calls from around Wall Street, compiled by The Fly. WALMART UPPED TO BUY AT DEUTSCHE: Deutsche Bank analyst Paul Trussell upgraded Walmart (WMT) to Buy from Hold and raised his price target for the shares to $113 from $89. The retailer is reaping returns on the many years of investment in e-commerce and customer service, Trussell said. The analyst believes Walmart is now in position to accelerate market share gains in grocery while also growing EBIT dollars and expanding return on investment. He believes Walmart's portfolio of assets is differentiated in the "rapidly changing" retail landscape. In late morning trading, Walmart is up just over 2%. KROGER CUT TO SELL AT DEUTSCHE: Deutsche Bank analyst Paul Trussell downgraded Kroger (KR) to Sell from Hold and lowered his price target for the shares to $24 from $30. Kroger's strategy to aggressively expand e-commerce capabilities, optimize space within current footprint, and compete on price "will likely be significantly more costly than the company and consensus are currently forecasting," Trussell said. The analyst, while believing Kroger may be one of the winners in food retail over the long term, thinks the "period of rapid change" in the grocery sector will likely make it challenging for the company to grow profits "while playing from a position of weakness." JEFFERIES UPGRADES BAKER HUGHES TO BUY: Jefferies analyst Brad Handler upgraded Baker Hughes (BHGE) to Buy from Hold and raised his price target for the shares to $38 from $34. Earnings power of $4 per share next decade "seems tangible," as is free cash flow conversion of greater than 90% of estimated earnings, Handler said. Further, he thinks General Electric (GE) "fire-sale" risk is small. MACQUARIE STARTS TESLA WITH AN OUTPERFORM: Macquarie analyst Maynard Um initiated Tesla (TSLA) with an Outperform rating and $430 price target, stating that he sees the company having unique potential among carmakers to be a leader in in-vehicle ecosystem platforms. In the near-term, Um also thinks Tesla has enough levers to get over its "debt maturity hump," including cash flow from ZEV credits and Model 3 sales, access to $1.2B unused debt commitment, and the potential for credit amendments. MOFFETTNATHANSON SAYS SNAP WILL NEED TO RAISE CAPITAL: MoffettNathanson analyst Michael Nathanson said he is skeptical, despite Snap (SNAP) CEO Evan Spiegel's internal memo, that the company can hit his stated 2019 goal of achieving full year positive free cash flow and profitability. Snap "is quickly running out of money," contends Nathanson, who thinks the company will need to raise capital by the middle to end of 2019. The analyst lowered his revenue estimates for 2019 and 2020 as he anticipates slower DAU and ARPU growth ahead and maintained his Neutral rating on Snap shares, though he cut his price target to $6.50 from $8.

10/10/18

WOLF

10/10/18INITIATIONTarget $37WOLFOutperform

Baker Hughes initiated with an Outperform at Wolfe Research

Wolfe Research initiated Baker Hughes with an Outperform and $37 price target.

As previously reported, Morgan Stanley analyst Connor Lynagh downgraded C&J Energy Services to Equal Weight from Overweight as he reduced his 2019 Hz rig count forecast by about 6%, to 908 rigs, on average. Given his view that Permian constraints will "dominate the narrative" through the Q2 earnings season, and his belief that the Permian's regional weakness has potential to transmit to other basins, Lynagh recommends decreasing completions exposure and increasing land drilling exposure.

09/17/18

JRCO

09/17/18INITIATIONTarget $26JRCOAccumulate

C&J Energy Services initiated with an Accumulate at Johnson Rice

Johnson Rice analyst Daniel Burke initiated C&J Energy Services with an Accumulate and $26 price target. Burke said the 37% decline in shares year-to-date more than reflects the weakening US pumping market and healthy crude prices and Permian takeaway relief in 2H 2019 could drive a recovery.

FTS International upgraded to Overweight from Equalweight at Capital One

Capital One upgraded FTS International to Overweight saying the outlook for 2H 2019 and 2020 is "very bright" as additional Permian takeaway capacity comes online, reactivations are mostly finished, and incremental newbuilds are only being added in a disciplined manner.

09/10/18

STFL

09/10/18INITIATIONTarget $12STFLHold

FTS International initiated with a Hold at Stifel

Stifel analyst Stephen Gengaro initiated FTS International with a Hold rating and a price target of $12. The analyst says the company is "well positioned to benefit from the rising frac demand expected over the next several years", but also warns that its EBITDA per fleet may lag its peers over the next few quarters.

08/02/18

FBCO

08/02/18NO CHANGETarget $15FBCOOutperform

FTS International price target lowered to $15 from $26 at Credit Suisse

Credit Suisse analyst James Wicklund lowered his price target for FTS International to $15 from $26 after the company reported a missed quarter, with crews being released by a few different customers in the Marcellus as budgets ran out and completion efficiency put production ahead of schedule, guiding Q3 down on crews, revenues and margins, while acknowledging plans to increase activity in Q4. The analyst reiterates an Outperform rating on the shares.

07/25/18

SOCO

07/25/18INITIATIONTarget $15SOCOEqualweight

FTS International initiated with an Equalweight at Capital One

Capital One initiated FTS International with an Equal Weight and $15 price target.

HALHalliburton

$39.56

-0.52 (-1.30%)

10/17/18

BOFA

10/17/18INITIATIONTarget $52BOFABuy

Halliburton initiated with a Buy at BofA/Merrill

BofA/Merrill analyst Chase Mulvehill initiated Halliburton with a Buy rating and a price target of $52.

10/12/18

SOCG

10/12/18DOWNGRADESOCGHold

Halliburton downgraded to Hold from Buy at Societe Generale

10/12/18

SPHN

10/12/18INITIATIONTarget $55SPHNOverweight

Halliburton initiated with an Overweight at Stephens

Stephens analyst Tommy Moll initiated Halliburton with an Overweight rating and $55 price target, calling the stock "the cleanest way to play large-cap oilfield services." While acknowledging the short-term headwind of Permian infrastructure limitations, Moll said he anticipates a reacceleration in activity levels by mid-2019.

As previously reported, Societe Generale analyst Edward Muztafago made several ratings changes in the oil services space as he recommended rotating more fully into offshore and reducing U.S. land exposure. He views U.S. activity being poised for constrained growth following an anticipated recovery from "the current frac malaise," while believing offshore activity appears set to inflect, Muztafago tells investors. With that backdrop view, he upgraded Ensco (ESV), Noble Corp. (NE) and Oceaneering (OII), all to Buy from Hold, downgraded Halliburton (HAL) to Hold from Buy and lowered his rating on Weatherford (WFT) to Sell from Buy. Current U.S. challenges and the "stock market meltdown" create risk to Weatherford's asset divestiture plans that investors are so concerned about and "stumbles may not be well received," Muztafago stated.

FRACKeane Group

$12.50

-0.14 (-1.11%)

10/17/18

BOFA

10/17/18INITIATIONTarget $19BOFABuy

Keane Group initiated with a Buy at BofA/Merrill

BofA/Merrill analyst Chase Mulvehill initiated Keane Group with a Buy rating and a price target of $19.

09/10/18

STFL

09/10/18INITIATIONTarget $16STFLBuy

Keane Group initiated with a Buy at Stifel

Stifel analyst Stephen Gengaro initiated Keane Group with a Buy rating and a price target of $16. The analyst says the company is a "very well run business" that is generating free cash flows, adding that its "dedicated service agreements" should limit the expected EBITDA deterioration.

06/29/18

WELS

06/29/18DOWNGRADETarget $27WELSMarket Perform

U.S. Silica downgraded to Market Perform from Outperform at Wells Fargo

Wells Fargo analyst Judson Bailey downgraded U.S. Silica (SLCA) to Market Perform and lowered his price target for the shares to $15 from $20. Downside risk for completion activity over the next few quarters and negative pricing and demand data points already rolling in for pressure pumping create risk to consensus estimates, Bailey tells investors in a research note. The analyst believes the pressure pumping market is already weakening. Bailey this morning also downgraded shares of C&J Energy Services (CJ), FTS International (FTSI) and Keane Group (FRAC).

06/29/18

WELS

06/29/18DOWNGRADETarget $15WELSMarket Perform

Keane Group downgraded to Market Perform from Outperform at Wells Fargo

Wells Fargo analyst Judson Bailey downgraded Keane Group to Market Perform and lowered his price target for the shares to $15 from $20. Downside risk for completion activity over the next few quarters and negative pricing and demand data points already rolling in for pressure pumping create risk to consensus estimates, Bailey tells investors in a research note. The analyst believes the pressure pumping market is already weakening.

Wolfe Research initiated Nabors Industries with an Outperform and $8 price target calling it a "top drilling idea."

08/03/18

SOCG

08/03/18UPGRADESOCGBuy

Nabors Industries upgraded to Buy from Hold at Societe Generale

07/12/18

07/12/18UPGRADE

On The Fly: Top five analyst upgrades

Catch up on today's top five analyst upgrades with this list compiled by The Fly: 1. Johnson & Johnson (JNJ) upgraded to Neutral from Sell at Goldman Sachs with analyst Jami Rubin saying the stock is down 10% year-to-date and 15% from its recent all-time high of $148. 2. Hallmark Financial (HALL) upgraded to Outperform from Market Perform at Raymond James. 3. Transocean (RIG), Ensco (ESV), and Rowan Companies (RDC) were upgraded to Buy from Hold at Tudor Pickering. 4. Precision Drilling (PDS) and Nabors Industries (NBR) were upgraded to Overweight from Equal Weight at Morgan Stanley. 5. CA Technologies (CA) upgraded to Market Perform from Underperform at Wells Fargo and Bernstein. This list is just a portion of The Fly's full analyst coverage. To see The Fly's full Street Research coverage, click here.

Catch up on today's top five analyst initiations with this list compiled by The Fly: 1. Liberty Global (LBTYA) initiated with a Sell at Berenberg. 2. Emergent BioSolutions (EBS) initiated with a Buy at Argus. 3. Nine Energy Services (NINE) initiated with a Strong Buy at Raymond James. 4. Can-Fite BioPharma (CANF) assumed with a Buy at H.C. Wainwright. 5. Control4 (CTRL) initiated with a Buy at Roth Capital. This list is just a portion of The Fly's analyst coverage. To see The Fly's full Street Research coverage, click here.

Wolfe Research initiated Patterson-UTI with a Peer Perform and $20 price target.

10/17/18

BOFA

10/17/18INITIATIONTarget $23BOFABuy

Patterson-UTI initiated with a Buy at BofA/Merrill

BofA/Merrill analyst Chase Mulvehill initiated Patterson-UTI with a Buy rating and a price target of $23.

10/05/18

BERN

10/05/18INITIATIONTarget $21BERNOutperform

Patterson-UTI initiated with an Outperform at Bernstein

As previously reported, Bernstein analyst Colin Davies initiated Patterson-UTI with an Outperform rating and $21 price target, telling investors in a research note that the company benefits from "super-spec" rigs but is dragged down by a pullback in the U.S. fracking market. Davies believes the stock will re-rate in 2019 as Permian issues abate, contending that the company's Permian-exposed frac business will suffer from lower activity and pricing in the near-term, but activity should find a floor in early 2019 and the stock will begin to anticipate rapidly improving conditions.

10/05/18

10/05/18INITIATION

On The Fly: Top five analyst initiations

Catch up on today's top five analyst initiations with this list compiled by The Fly: 1. Patterson-UTI (PTEN) initiated with an Outperform at Bernstein. 2. QuinStreet (QNST) initiated with an Outperform at William Blair. 3. Natera (NTRA) initiated with a Neutral at JPMorgan. 4. Avaya (AVYA) initiated with an Equal Weight at Barclays. 5. Roku (ROKU) initiated with a Neutral at Wedbush. This list is just a portion of The Fly's analyst coverage. To see The Fly's full Street Research coverage, click here.

PUMPProPetro Holding

$18.19

-0.315 (-1.70%)

08/30/18

RHCO

08/30/18NO CHANGETarget $24RHCOBuy

ProPetro Holding price target lowered to $24 from $28 at SunTrust

SunTrust analyst Ken Sill lowered his price target on ProPetro Holding to $24, saying he expects the completions in the Permian to slow for the rest of 2019 and into early 2019. The analyst keeps his Buy rating however, noting that ProPetro's profitability should hold up better than those of many of its peers, given that its "core customers don't face the takeaway capacity constraints and pricing differentials". Sill further states that ProPetro Holding should have above-average utilization rates and generate "solid margins".

10/10/18

WOLF

10/10/18INITIATIONTarget $24WOLFOutperform

ProPetro Holding initiated with an Outperform at Wolfe Research

Wolfe Research initiated ProPetro Holding with an Outperform and $24 price target calling it a "top pumping idea."

Stifel analyst Stephen Gengaro initiated ProPetro Holding with a Buy rating and a price target of $18. The analyst cites the company's "rock-solid balance sheet" and expectations of "strong free cash flow" in 2019-20 driven by its "dedicated agreements with high-quality customers" that may offset some of the short-term pricing pressure.

SLBSchlumberger

$59.24

-0.43 (-0.72%)

10/12/18

SPHN

10/12/18INITIATIONTarget $65SPHNEqual Weight

Schlumberger initiated with an Equal Weight at Stephens

Stephens analyst Tommy Moll initiated Schlumberger with an Equal Weight rating and $65 price target, stating that while he anticipates revenue growth both internationally and in North America in 2019, overly optimistic international expectations and the potential drag from North America on profitability put 2019 earnings at risk.

10/10/18

WOLF

10/10/18INITIATIONTarget $68WOLFPeer Perform

Schlumberger initiated with a Peer Perform at Wolfe Research

Wolfe Research initiated Schlumberger with a Peer Perform and $68 price target.

10/02/18

10/02/18DOWNGRADE

On The Fly: Top five analyst downgrades

Catch up on today's top five analyst downgrades with this list compiled by The Fly: 1. Goldman downgraded ConocoPhillips (COP) to Neutral following share outperformance with analyst Neil Mehta citing valuation. 2. U.S. Steel (X) and Reliance Steel (RS) were downgraded to Hold from Buy at Deutsche Bank. 3. Unilever (UN, UL) downgraded to Hold from Buy at Jefferies with analyst Martin Deboo saying the company is facing "choppier waters" and "higher expectations." 4. Ambev (ABEV) double downgraded to Sell from Buy at UBS with analyst Alan Alanis saying AmBev trades at a 25% higher valuation than parent company AB InBev (BUD), which is unwarranted. 5. Schlumberger (SLB) downgraded to Hold from Buy at Tudor Pickering. This list is just a portion of The Fly's full analyst coverage. To see The Fly's full Street Research coverage, click here.

10/17/18

BOFA

10/17/18INITIATIONTarget $73BOFABuy

Schlumberger initiated with a Buy at BofA/Merrill

BofA/Merrill analyst Chase Mulvehill initiated Schlumberger with a Buy rating and a price target of $73.

CVIACovia

$7.01

-0.57 (-7.52%)

10/17/18

BOFA

10/17/18INITIATIONTarget $5.25BOFAUnderperform

Covia initiated with an Underperform at BofA/Merrill

BofA/Merrill analyst Chase Mulvehill initiated Covia with a Underperform rating and a price target of $5.25.

10/17/18

JEFF

10/17/18DOWNGRADEJEFF

Jefferies downgrades four names on 'sinking' white sand demand

Jefferies analyst Brad Handler downgraded Hi-Crush Partners (HCLP) and Smart Sand (SND) to Underperform from Hold as well as Covia (CVIA) and U.S. Silica (SLCA) to Hold from Buy citing "sinking" Northern white sand demand and prices. The analyst sees the weakness spreading to regional/in-basin sand and ultimately to box/silo-based last-mile solutions as "supply adds overtake demand growth." He also expects the Q3 earnings season to drive downward estimate revisions. Smart Sand, Covia and Hi-Crus have the highest Northern white sand exposure, Handler tells investors in a research note.

10/17/18

JEFF

10/17/18DOWNGRADETarget $8JEFFHold

Covia downgraded to Hold from Buy at Jefferies

Jefferies analyst Bradley Handler downgraded Covia Holdings to Hold and lowered his price target for the shares to $8 from $15.

10/11/18

10/11/18DOWNGRADEUnderweight

U.S. Silica, Covia downgraded to Underweight at Morgan Stanley

As previously reported, Morgan Stanley analyst Connor Lynagh downgraded Covia (CVIA) and U.S. Silica (SLCA), both to Underweight from Equal Weight, as he remains constructive on the Oil Services industry on a 12- to 18-month view, but agrees with widespread concerns that near-term estimates remain too high. He is most concerned about the sand market, which is deteriorating faster than he expected, Lynagh tells investors. Given the industry's supply/demand set-up, Lynagh sees it as hard to believe investors will bet on a rebound, he added. The analyst cut his price target on Covia shares to $9 from $11 and lowered his target for U.S. Silica to $18 from $25.

HPHelmerich & Payne

$68.06

-1.13 (-1.63%)

10/05/18

10/05/18UPGRADE

On The Fly: Top five analyst upgrades

Catch up on today's top five analyst upgrades with this list compiled by The Fly: 1. Eli Lilly (LLY) upgraded to Outperform from Market Perform at BMO Capital with analyst Alex Arfaei citing the prospects of its LY3298176, a GIP and GLP-1 dual receptor agonist presented at EASD 54th Annual Meeting, which he believes "meaningfully improves" the company's long-term growth prospects. 2. Helmerich & Payne (HP) upgraded to Overweight from Equalweight at Capital One. 3. Canadian Pacific (CP) upgraded to Buy from Hold at TD Securities. 4. Eni SpA (E) and Equinor (EQNR) were upgraded to Buy from Neutral at BofA/Merrill. 5. Fiesta Restaurant (FRGI) upgraded to Neutral from Underweight at Piper Jaffray with analyst Nicole Miller Regan saying the company has recently reported better than expected results and sustained a return to positive same-store sales trends. This list is just a portion of The Fly's full analyst coverage. To see The Fly's full Street Research coverage, click here.

10/15/18

WELS

10/15/18NO CHANGETarget $72WELSMarket Perform

Helmerich & Payne price target raised to $72 from $66 at Wells Fargo

Wells Fargo analyst Judson Bailey raised his price target for Helmerich & Payne to $72 from $66 to primarily reflect continued strength in super spec day rates and signs of the super spec rig count holding firm and as recent data points suggesting leading edge rates in the $25-$28k range. The analyst believes the NAM-leveraged smid cap landscape is particularly complicated heading into Q3 EPS season with broad downside risk to Q4 and 2019 estimates but longer-term fundamentals and valuations that generally look appealing. Bailey reiterates a Market Perform rating on the shares.